Ashland residents charged in sale of harmful supplement

Thursday

Feb 7, 2013 at 12:01 AMFeb 7, 2013 at 2:30 AM

An Ashland couple and two others face federal charges for running a scheme to sell a diluted form of industrial bleach as a medicinal cure for anything from arthritis to HIV and swine flu — even though they should have known the elixir was potentially deadly.

By MARK FREEMAN

An Ashland couple and two others face federal charges for running a scheme to sell a diluted form of industrial bleach as a medicinal cure for anything from arthritis to HIV and swine flu — even though they should have known the elixir was potentially deadly.

Louis Daniel Smith, 42, and Karis Delong, 38, both of Ashland, face six charges ranging from the interstate sale of misbranded drugs to smuggling for selling the so-called "Miracle Mineral Supplement" through their online company called Project GreenLife.

The supplement was a mixture of water and sodium chlorite that buyers were told to mix with citric acid to form chlorine dioxide, which actually is an industrial chemical used to bleach textiles and disinfect wastewater, according to court records. Labeling on the chemical states it should never be ingested because it can cause digestive tract burning, nausea, diarrhea and dehydration. If inhaled, it can cause respiratory distress, lung congestion and possibly death.

MMS was made and shipped out of eastern Washington from 2004 to 2011. The chemicals were first bought in Utah under the guise of a fake water treatment systems company and later smuggled from Canada with fake invoices to conceal its true use, records state.

The charges are outlined in a secret indictment unsealed Tuesday in U.S. District Court in eastern Washington.

Smith, Delong and codefendant Tammy Olson, 50, of Nine Mile Falls, Wash., were each charged with conspiracy, four counts of interstate sales of misbranded drugs and one count of smuggling.

Also charged was Olson's husband, 49-year-old Chris Olson, with one count of conspiracy, one count of the interstate sale of a misbranded drug and one count of smuggling.

Delong and Smith were arrested Tuesday morning in Ashland by agents from the federal Food and Drug Administration and the U.S. Postal Service and lodged at the Jackson County Jail, federal prosecutor Christopher Parisi said Wednesday.

The pair were shackled when they made their initial appearances Wednesday afternoon in U.S. District Court in Medford before U.S. Magistrate Judge Mark Clarke, who ordered Smith detained and sent to Spokane, where the case will be handled.

Clarke ordered Delong held in jail in Medford to give her time to arrange for family members in Washington to take custody of the couple's daughter, who was described in court as being age 8 or 9. Clarke ordered Delong back into his courtroom Friday afternoon.

Parisi said Delong and Smith recently moved to Ashland and have no ties here.

Court records filed so far in the case do not allege that anyone was sickened after ingesting MMS, nor do they say how much money the group allegedly made from the Internet-based scheme. However, records show federal agents already have seized about $22,300 from three bank accounts as well as about $3,300 worth of Iraqi dinars seized at an address in Spokane.

The indictment states that Smith, who also used the alias Daniel Votino, was a "trustee" in what they called "Project GreenLife — A Private Healthcare Membership Association." Delong, who also used the name Karis Copper, was listed as a managing member who frequently handled financial transactions for the company, the indictment states.

Chris Olson allegedly made and bottled the MMS at his Spokane residence during the last two years of the scheme and Tammy Olson handled customer care, the indictment states.

They sold MMS through various websites and provided a "Newbies" pamphlet detailing oral ingestion protocols for MMS, records show. The pamphlet also claimed chlorine dioxide had several beneficial impacts to those suffering from a variety of ailments, such as HIV/AIDS, pneumonia, tuberculosis, bird and swine flu and many other conditions, the indictment states.

They were warned several times from chemical suppliers that ingesting sodium chlorite could be very harmful and potentially fatal, according to the court documents.

Their operation first gained the interest of their unidentified Utah chemical distributor in February 2008 when the company's parent organization expressed concern that sodium chlorite was being used for human consumption.

In March 2008, the company sent Smith a letter about its concerns and Smith emailed back: "No issues, our product is labeled for water purification," the indictment states.

Smith then created an Internet domain pglwater.com, according to the indictment.

A year later, the Utah company sent PGL a questionnaire regarding its sodium chlorite order.

Smith allegedly emailed the Utah company salesman that PGL was "gonna take a pass" on the chemical order and instead has found another sodium chlorite source "from outside the country where the grief-o-meter is relatively low," the indictment states.

FDA agents in 2010 inspected the company's production and shipping facilities in and around Spokane. That production company then severed ties with PGL, so Smith and Delong hired Chris Olson to produce MMS at his residence, the indictment states. That residence was searched by federal agents in June 2011.

The case is being prosecuted out of the federal Department of Justice's Consumer Protection Branch in Washington, D.C., where Parisi is assigned.

Reach reporter Mark Freeman at 541-776-4470, or email at mfreeman@mailtribune.com.